Gold Rises for Day Three as Dollar Weakens and Oil Rallies, Silver Tops $14

Gold and silver on Thursday marked a third straight day of gains while platinum rose for day two. Helping the yellow metal was a weakened U.S. dollar, rallying crude-oil prices and a mention of possible Chinese purchases. U.S. stocks returned in a posistive session as well with two percent increases in the major indexes.

In New York trading futures for bullion:

Silver for July delivery rose 9.5 cents, or 0.7 percent, to $14.005 an ounce.

Gold for August delivery gained $5.10, or 0.5 percent, to $939.50 an ounce.

July platinum jumped $23.10, or 2.3 percent, to $1,191.00 an ounce.

"It is likely that China will buy further gold over the coming months and years, as, in contrast to other countries, gold still accounts for only a small proportion of China’s entire foreign exchange reserves," analysts at Commerzbank quoted on MarketWatch said.

In London bullion, the benchmark gold price was set earlier in the day to $937.25 an ounce, which was $3.75 higher than the fixing on Wednesday. Silver fell a penny to $13.87 an ounce. Platinum was fixed $3.00 higher to $1,176.00.

Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.

Oil and gasoline prices

Oil passed over $70 Thursday "after militants attacked a key pipeline in Nigeria, the fifth largest oil exporter to the U.S.," writes Moming Zhou and Myra P. Saefong of MarketWatch.

New York crude-oil for August delivery surged $1.56, or 2.3 percent, to close at $70.23 a barrel.

In a trend unlikely to continue, prices at the pump on Thursday declined for a third straight day. The national average for unleaded gasoline fell nine-tenths of a cent to $2.667 a gallon, according to a AAA report. The price is 1.8 cents lower than a week ago but still 24.2 cents higher than last month.

U.S. Stocks

U.S. stocks rallied "after a week of choppy trading, as investors scooped up a variety of shares hit in the recent selloff — including commodity, consumer, homebuilding and tech issues," writes Alexandra Twin of CNNMoney.